To accommodate the developments in the import sector, on September 25, 2023, the Government of Indonesia (the "Government") enacted Government Regulation No. 46 of 2023 on the Amendment to the Government Regulation No. 28 of 2021 on the Implementation of the Industrial Sector ("GR 46/2023"). The amendments under GR 46/2023 include the alterations and deletions of provisions associated with the import of raw and/or supporting materials (collectively, the "Materials").
Today, imports of Materials are not always carried out by the holders of Producer Importer Identification Number (Angka Pengenal Importir Produsen or "API-P"), but there are also business models that require the imports of Materials to be performed by holders of General Importer Identification Number (Angka Pengenal Importir Umum or "API-U"). In this regard, the Government views that it is necessary to issue a regulation as the basis to enable the holders of API-U to import the Materials.
- Previous Provisions on Import of Materials
As a background, prior to the enactment of GR 46/2023, Article 19(1) of Government Regulation No. 28 of 2021 on the Implementation of the Industrial Sector ("GR 28/2021") only allowed the import of Materials to be conducted by manufacturers that hold API-P.
GR 28/2021 conditionally allowed the holders of API-U to carry out the imports of Materials, only in the case that the import was utilized for small and mid-scale industries that could not conduct the imports by themselves, and provided that the holder of API-U were able to provide the order contracts from the relevant small and mid-scale industries.
Furthermore, GR 28/2021 stipulated that manufacturers that conduct the import of Materials were not allowed to sell or transfer the Materials imported. However, the prohibition to sell or transfer the imported Materials was excluded if the imported products were in the form of the remains of the Materials that are further regulated in the Minister of Industry Regulation No. 22 of 2021 on Terms of Sale or Transfer of Raw and Supporting Materials.
- New Provisions on Import of Materials
Under GR 46/2023, the Government now allows the imports of Materials to be carried out by enterpreneurs that holds API-U, in addition to being carried out by holders of API-P. Nevertheless, the import of Materials conducted by holders of API-U is still limited. API-U holders are not allowed to conduct imports of certain Materials that are regulated and determined of their distribution and supervision in a specific way, such as raw sugar, clinker cement, and/or non-toxic and hazardous waste as a raw material for industries. Therefore, holders of API-U must also observe the provisions on imports for such certain Materials.
In addition, GR 46/2023 maintains the provision regarding the right of API-U holders to carry out the imports of Materials that are utilized for small and mid-scale industries that are not able to carry out the imports by themselves. However, GR 46/2023 removes the obligation of such API-U holders to provide the order contracts from the relevant small and mid-scale industries for conducting the import of Materials.
Furthermore, the provisions on the prohibition of manufacturers from selling or transferring the imported Materials and the exclusion of such prohibitions in the case of import in the form of the remains of the Materials are being clarified under GR 46/2023.
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